UK Banks Still Blocking Bitcoin, Policy Group Tells Parliament

Bitcoin Policy UK has slammed British banks for applying blanket restrictions to lawful bitcoin activity.
The organization said in an announcement Friday that it had submitted evidence to the Crypto and Digital Assets APPG’s parliamentary inquiry into banking access, revealing that no improvements had been made over the past three years in how banks treat bitcoin activity.
The issue: UK policy treats “crypto” as one thing, so bitcoin is caught by rules written for unbacked tokens and issuer-dependent stablecoins.
The British government has said since 2023 that banks should assess case by case rather than restrict by sector. The group says practice has not followed, and that the gap is widening as the UK moves toward full implementation of its cryptoasset regime in 2027.
Bitcoin Policy UK called on British banks to give reasons for rejecting bitcoin-related activity.
“Almost three years after we first raised blanket banking restrictions with the City Minister, our evidence to the Crypto and Digital Assets APPG inquiry shows the problem hasn’t improved,” Bitcoin Policy UK said in a Sunday post on X.
“Roughly 40% of bank-to-exchange transfers in the UK are currently blocked or delayed.”
The organization filed evidence with the Crypto and Digital Assets All-Party Parliamentary Group’s inquiry into banking access.
A joint survey by Startup Coalition, the UK Cryptoasset Business Council and Global Digital Finance, published in January 2025, found that half of the UK fintech and crypto firms it canvassed had been refused a bank account or had one closed, and that only 14% had opened and kept an account with one of the country’s nine largest banks. Most were UK-based operations rather than firms with no domestic presence.
Virgin Money, Metro Bank, Starling Bank, TSB and Chase UK block transfers and card payments outright, while Barclays and HSBC cap transfers at £2,500 ($3,400) per transaction, Bitcoin Policy UK said.
It added that 80% of the exchanges said restrictions had increased over the previous year. None reported an improvement. An IG Group survey from August 2025 found 40% of active crypto investors had a payment blocked or delayed by their own bank.
The submission makes four requests: a regulatory statement that bitcoin activity through an FCA-registered exchange should not face blanket restriction; a duty on banks to give specific reasons and an appeals route; confirmation that FCA registration can serve as a risk basis, as in Hong Kong; and a published periodic measure of restriction levels.
In December, City Minister Lucy Rigby said that Britain can “without a doubt” compete with the United States and become an international hub for cryptoassets.

Facts Only

* Bitcoin Policy UK submitted evidence to the Crypto and Digital Assets APPG parliamentary inquiry into banking access.
* Evidence showed no improvement in how banks treat bitcoin activity over the past three years.
* The issue arises because UK policy treats "crypto" broadly, including bitcoin, which is caught by rules for unbacked tokens and issuer-dependent stablecoins.
* The British government stated since 2023 that banks should assess cases individually rather than restrict by sector.
* Roughly 40% of bank-to-exchange transfers in the UK are currently blocked or delayed.
* Some banks, including Virgin Money, Metro Bank, Starling Bank, TSB, and Chase UK, block transfers and card payments outright.
* Barclays and HSBC cap transfers at £2,500 ($3,400) per transaction.
* 80% of exchanges reported that restrictions had increased over the previous year with no reported improvement.
* A survey found 40% of active crypto investors had a payment blocked or delayed by their own bank.
* The submission requested a regulatory statement against blanket restrictions, a duty for banks to give reasons, an appeals route, confirmation of FCA registration as a risk basis, and periodic restriction measures.

Executive Summary

Bitcoin Policy UK has presented evidence to the Crypto and Digital Assets APPG inquiry regarding banking access, alleging that British banks have applied blanket restrictions to lawful bitcoin activity without making improvements over the last three years. The organization points out that UK policy treats "crypto" broadly, which encompasses bitcoin under rules intended for unbacked tokens and issuer-dependent stablecoins. The group argues that the government's stated goal since 2023—that banks should assess cases individually rather than restrict by sector—has not been followed. Specific banking practices noted include outright blocking of transfers for some institutions and capping of amounts for others. Furthermore, a joint survey indicated difficulties for fintech firms in opening or maintaining bank accounts with major UK banks. The submission requests regulatory changes, including a statement against blanket restrictions, a duty for banks to provide reasons for rejections, confirmation that FCA registration can serve as a risk basis, and periodic restriction measures.

Full Take

The narrative presents a tension between high-level governmental ambition—stating Britain can compete with the US in cryptoassets—and the on-the-ground operational reality described by industry groups. The core conflict is not merely about access, but about definitional consistency and regulatory velocity. By grouping bitcoin under existing rules for unbacked tokens, the framework creates an inherent friction point where a blanket policy (sector-based restriction) contradicts the stated principle of case-by-case assessment. This suggests a structural failure in applying principles across disparate asset classes within a unified regulatory structure. The pattern of reported increases in restrictions by exchanges, coupled with the lack of observable improvement despite government rhetoric, signals an operational disconnect between policy intent and implementation reality. Furthermore, the shift from sector-based restriction to individual assessment implies that banking infrastructure must rapidly adapt to nuanced risk profiling, a transition that has demonstrably lagged. The requests for specific reasons and appeals routes are not just procedural demands; they challenge the legitimacy of opaque administrative decisions in a digital asset context. The implication for agency is whether regulatory frameworks prioritize broad control or granular fairness when deploying mechanisms designed to manage systemic risk. Bridge questions include: If framework definitions remain rigid, what is the optimal mechanism—sectoral versus individual—for embedding dynamic risk assessment? How can regulatory bodies ensure that procedural remedies (appeals) are effective against systemic inertia in banking practices? What accountability structure is necessary when official statements about international competitiveness diverge from domestic operational constraints?

Sentinel — Human

Confidence

This text appears to be grounded in specific institutional submissions and survey data, indicating a journalistic or advocacy reporting style rather than pure synthetic generation.

Signals Detected

Moderate sentence length variance; uses direct quotes and specific statistics which suggests source material grounding.

Direct reporting of specific organizations, dates (2023, 2025), and named banks indicates specific sourcing, reducing the 'balanced but passionate nowhere' risk.

Data points are attributed to named bodies (Bitcoin Policy UK, Startup Coalition, IG Group) and specific surveys. The structure follows a typical advocacy/reporting pattern.

The article relies heavily on citing specific internal evidence submissions and survey results, which anchors the claims in verifiable (though complex) external data.

Human Indicators

Presence of specific, multi-sourced statistics tied to named bodies and explicit calls for regulatory action suggests reporting based on filed evidence rather than pure narrative construction.

The juxtaposition of high-level government statements (City Minister Lucy Rigby) with granular banking restrictions creates a layered, non-uniform narrative flow typical of policy journalism.